India’s solar module manufacturing capacity is expected to cross 125 GW by 2025—more than three times the projected domestic demand of 40 GW—according to a new Wood Mackenzie report. This surge underscores India’s rapid rise as a global solar manufacturing hub, propelled by government initiatives like the Production-Linked Incentive (PLI) scheme.
However, the expansion comes with challenges. The report warns of a potential inventory surplus of up to 29 GW by Q3 2025, as domestic demand lags behind production. Compounding this, new 50% reciprocal tariffs from the United States have caused Indian module exports to drop by 52% in early 2025, forcing manufacturers to pivot back to the local market.
While policy measures such as the Approved List of Models and Manufacturers (ALMM) and proposed anti-dumping duties provide short-term relief, experts highlight that India’s long-term solar success depends on enhancing cost competitiveness, boosting R&D, adopting next-generation cell technologies, and expanding export opportunities.
The analysis suggests that India is on track to become a formidable solar manufacturing force—but must overcome pricing pressures and trade barriers to challenge China’s global dominance.
